Canada's stock market set to reopen after rare shutdown

Fergal Smith, John Tilak

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TORONTO, April 30 (Reuters) - Canada's stock exchange, the world's sixth largest, is set to reopen on Monday after its operator said over the weekend that it fixed the error that halted the market for several hours on Friday afternoon.

The rare outage on Friday disrupted Canada's stock trading, sending investors to rival platforms, and had the potential to dent the credibility of the exchange, fund managers and traders told Reuters.

TMX Group Ltd, which operates the Toronto Stock Exchange and smaller Canadian trading platforms, said in a statement on Saturday that the failure of data storage equipment caused the outage.

The saving grace for TMX, which has been vying to host Saudi Aramco's mega IPO overseas listing, was that the glitch occurred on a low-volume trading day and on a Friday, giving the operator the weekend to resolve the issue.

Jos Schmitt, chief executive of rival operator NEO Exchange, said the market went dark when the outage occurred. "There is a lack of real-time market data in Canada and Friday's events demonstrate this is a big problem," he added.

Outages can inconvenience investors and prove expensive for the exchanges themselves. But many of Canada's blue-chip stocks are also traded on U.S. stock exchanges, giving investors another avenue to trade. Investors are hopeful that TMX has taken sufficient measures to ensure the smooth resumption of trade at 9:30 a.m. (1330 GMT) on Monday.

"I suspect the TSX has undertaken many system reviews over the weekend to ensure an orderly and smooth reopening of exchanges on Monday morning," said Mike Archibald, associate portfolio manager at AGF Investments.

Traders warned that another disruption could hurt confidence and fuel anxiety.

TMX said on Saturday the disruption was caused by a "hardware failure in a central storage appliance of the trading system," and noted it was not the result of a hack.

Asked for additional comment on Sunday, a TMX spokeswoman referred to the company's statement on Saturday.

"Given it wasn't an overly heavy volume day on Friday, I suspect most market participants will manage being able to execute orders early on Monday morning,” Archibald said.

TMX's exchanges in Canada, which include the Toronto Stock Exchange, Toronto Venture Exchange, TSX Alpha Exchange and the Montreal Exchange, account for about 61 percent of trading, according to official data.

Canada's last major trading outage occurred nearly a decade ago, when a system fault linked to data feeds shut down trading for a full day in December 2008.

"Stuff happens from time to time," said Matt Skipp, president of SW8 Asset Management. "If it happened on an epic down day, it would be far more concerning for professionals." (Reporting by Fergal Smith and John Tilak; Editing by Peter Cooney)